Business, Government and Economics

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We also partner with another educational provider to offer certificates Human Resource Management. Another type of non-discretionary policy is a set of policies which are imposed by an international body. This can occur for example as a result of intervention by the International Monetary Fund. The first economic problem was how to gain the resources it needed to be able to perform the functions of an early government: Early governments generally relied on tax in kind and forced labor for their economic resources.

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However, with the development of money came the first policy choice. A government could raise money through taxing its citizens. However, it could now also debase the coinage and so increase the money supply. Early civilizations also made decisions about whether to permit and how to tax trade. Some early civilizations, such as Ptolemaic Egypt adopted a closed currency policy whereby foreign merchants had to exchange their coin for local money. This effectively levied a very high tariff on foreign trade.

By the early modern age, more policy choices had been developed.

Economic policy - Wikipedia

There was considerable debate about mercantilism and other restrictive trade practices like the Navigation Acts , as trade policy became associated with both national wealth and with foreign and colonial policy. Throughout the 19th Century, monetary standards became an important issue. Gold and silver were in supply in different proportions.

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Which metal was adopted influenced the wealth of different groups in society. With the accumulation of private capital in the Renaissance, states developed methods of financing deficits without debasing their coin.


The development of capital markets meant that a government could borrow money to finance war or expansion while causing less economic hardship. This was the beginning of modern fiscal policy. The same markets made it easy for private entities to raise bonds or sell stock to fund private initiatives.

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The business cycle became a predominant issue in the 19th century, as it became clear that industrial output, employment, and profit behaved in a cyclical manner. One of the first proposed policy solutions to the problem came with the work of Keynes , who proposed that fiscal policy could be used actively to ward off depressions, recessions and slumps. The Austrian School of economics argues that central banks create the business cycle.

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From Wikipedia, the free encyclopedia. Not to be confused with Political economy. For the academic journal, see Economic Policy journal. Index of politics articles Politics by country Politics by subdivision Political economy Political history Political history of the world Political philosophy.

Economic policy

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